18-Hour City

Written by True Tamplin, BSc, CEPF®

Reviewed by Subject Matter Experts

Updated on August 07, 2023

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What Is an 18-Hour City?

The term "18-hour city" has emerged in recent years as a new categorization in urban development and real estate.

Unlike the traditional 24-hour cities, such as New York or Los Angeles, which operate around the clock, 18-hour cities, such as Austin, Nashville, or Charlotte, have vibrant economies and active lifestyles from dawn until midnight.

They represent a unique blend of affordability, economic growth, and cultural amenities. They offer urban conveniences without the intense hustle and bustle (and often cost) associated with major metropolitan hubs.

The 18-hour city concept has significant implications for real estate. Investors, developers, and city planners alike are recognizing the potential of these markets as they offer promising opportunities for growth and investment.

Unlike the highly saturated real estate markets in 24-hour cities, 18-hour cities often present less competition and more affordable investment options.

Furthermore, they typically boast a growing population and dynamic economy, creating a steady demand for housing and commercial spaces.

Characteristics of an 18-Hour City

Growing Population and Economic Development

One of the key characteristics of an 18-hour city is its growing population and economic development. These cities typically exhibit strong demographic and economic trends, with significant growth in population, employment, and income levels.

This growth is often driven by factors such as a thriving job market, attractive lifestyle amenities, and the availability of affordable housing.

The resulting increase in demand for housing and commercial spaces creates promising opportunities for real estate investment.

Diverse and Vibrant Lifestyle Amenities

Another hallmark of 18-hour cities is the presence of diverse and vibrant lifestyle amenities. These include a wide range of dining, entertainment, and recreational options, cultural institutions, and green spaces.

These amenities not only enhance the quality of life for residents but also attract tourists and visitors, contributing to the local economy. Furthermore, they add value to real estate properties and make these cities more attractive to potential investors.

Strong Job Market and Employment Opportunities

18-hour cities typically boast a strong job market and abundant employment opportunities. They are often home to diverse industries, including tech, healthcare, finance, and education, attracting a skilled and educated workforce.

The robust job market increases the demand for both residential and commercial real estate, benefiting property owners and investors.

Moreover, a prosperous job market can contribute to a stable rental market, ensuring a steady income stream for rental property investors.

Efficient Transportation Infrastructure

Efficient transportation infrastructure is another defining feature of 18-hour cities. They usually have a well-developed public transit system, along with good road and airport connectivity.

This efficient transportation infrastructure not only makes these cities more livable for residents but also boosts their economic productivity.

For real estate investors, properties located near transportation hubs or major transit routes often yield higher rents and property values.

Availability of Affordable Housing Options

Compared to major metropolitan areas, 18-hour cities often offer a greater availability of affordable housing options.

This affordability attracts a wide range of residents, from young professionals to families, increasing the demand for housing.

This is a boon for real estate investors, as high demand combined with affordable investment costs can result in promising returns.

Furthermore, the affordability factor can contribute to a stable and diverse housing market, reducing the risk of housing bubbles.

Characteristics of an 18-Hour City

Benefits of Investing in an 18-Hour City

Potential for High Rental Yields and Property Appreciation

Investing in an 18-hour city can provide the potential for high rental yields and property appreciation. As these cities continue to grow and develop, the demand for both residential and commercial real estate tends to increase.

This growing demand, coupled with the cities' robust economies and dynamic populations, can result in strong rental markets and significant property appreciation over time.

Thus, real estate investments in these cities can offer promising returns and capital growth.

Lower Investment Costs Compared to Major Metropolitan Areas

Another benefit of investing in an 18-hour city is the lower investment costs compared to major metropolitan areas. Property prices in these cities are typically more affordable than in larger 24-hour cities, making it easier for investors to enter the market.

The lower investment costs can also translate into a higher return on investment, as investors can potentially earn more rental income relative to the property's purchase price.

Moreover, the affordability of these cities can attract a diverse range of tenants, leading to a stable and resilient rental market.

Reduced Competition in the Real Estate Market

One of the attractions of investing in an 18-hour city is the reduced competition in the real estate market.

Unlike the highly competitive markets in major cities, 18-hour cities often offer more opportunities for investors to find undervalued properties or to negotiate favorable purchase terms.

The reduced competition can also make it easier for investors to navigate the market and make strategic investment decisions.

Additionally, the less saturated market can mean fewer bidding wars and a less stressful investment experience.

Favorable Economic Conditions and Growth Prospects

18-hour cities typically offer favorable economic conditions and growth prospects. Their growing economies, strong job markets, and increasing populations create a positive environment for real estate investment.

The continued economic growth of these cities can lead to increased demand for housing and commercial spaces, benefiting property owners and investors.

Furthermore, the cities' growth prospects can offer long-term investment potential, making them attractive markets for strategic investors.

Attracting a Younger Demographic and Skilled Workforce

18-hour cities are known for attracting a younger demographic and skilled workforce. The combination of affordable housing, vibrant lifestyle amenities, and plentiful job opportunities makes these cities appealing to millennials and young professionals.

This demographic trend can have positive implications for real estate investors. Younger renters often prefer urban living and are more likely to rent for longer periods, contributing to a strong and stable rental market.

Additionally, the influx of a skilled workforce can drive economic growth and increase the demand for quality housing and office spaces.

Challenges and Risks in an 18-Hour City Market

Oversupply of Housing and Potential for Market Saturation

While 18-hour cities offer many investment opportunities, they also come with their share of challenges and risks.

One such risk is the potential for an oversupply of housing, which could lead to market saturation.

Rapid development and construction could result in a glut of housing supply, causing rental rates to stagnate or even decline.

As a real estate investor, it's important to monitor housing supply trends and vacancy rates to assess the risk of oversupply.

Economic Volatility and Reliance on Specific Industries

Another potential risk in the 18-hour city market is economic volatility and reliance on specific industries.

Some 18-hour cities have economies that are heavily concentrated in certain sectors, such as technology or manufacturing.

If these industries face downturns, it could negatively impact the local economy and real estate market.

Therefore, diversification of the local economy is a crucial factor to consider when investing in an 18-hour city.

Infrastructure Strain and Traffic Congestion

Rapid growth and urbanization in 18-hour cities can put a strain on infrastructure and lead to traffic congestion.

These issues can negatively affect the quality of life for residents and potentially deter future population growth.

For real estate investors, infrastructure development and traffic management are important considerations.

Properties in areas with good infrastructure and access to transportation are typically more desirable and can command higher rents.

Limited Availability of Investment-Grade Properties

In some 18-hour cities, there may be a limited availability of investment-grade properties.

This could make it challenging for investors to find suitable properties that meet their investment criteria.

Despite these challenges, the growth potential and attractive investment opportunities in 18-hour cities often outweigh the risks.

By conducting thorough market research and due diligence, investors can navigate these challenges and make informed investment decisions.

Benefits and Challenges of Investing in an 18-Hour City

Strategies for Investing in an 18-Hour City Market

Conduct Thorough Market Research and Analysis

The first strategy for investing in the 18-hour city market is to conduct thorough market research and analysis.

This includes studying the city's demographic and economic trends, housing market conditions, and future growth prospects.

Understanding these factors can help investors identify promising investment opportunities and assess the potential risks.

Additionally, market research can provide insights into the local rental market, including average rents, vacancy rates, and tenant demand.

Focus on Emerging Neighborhoods With Growth Potential

Another strategy is to focus on emerging neighborhoods with growth potential. These are areas that are in the early stages of development or gentrification and offer the potential for high property appreciation.

Emerging neighborhoods often feature new developments, infrastructure improvements, and increasing amenities, which can attract a growing population and boost property values.

By investing in these areas, investors can potentially achieve significant capital growth and high rental yields.

Consider Long-Term Growth Projections and Economic Indicators

When investing in an 18-hour city, it's important to consider long-term growth projections and economic indicators. These include factors such as job growth, population growth, and economic diversification.

These indicators can provide a picture of the city's future growth potential and economic stability. A city with strong growth projections and a diverse economy is likely to have a resilient real estate market, offering long-term investment potential.

Collaborate With Local Real Estate Professionals and Experts

Collaborating with local real estate professionals and experts is another effective strategy. Local experts have in-depth knowledge of the market and can provide valuable insights and advice.

They can help investors find promising investment properties, navigate the local real estate regulations, and make informed investment decisions.

Furthermore, they can assist with property management and tenant relations, ensuring a smooth and profitable investment experience.

Examples of Successful 18-Hour Cities

Austin, Texas

Austin, Texas, is a prime example of a successful 18-hour city. It boasts a thriving tech industry, vibrant cultural scene, and fast-growing population, making it an attractive market for real estate investors.

The city's strong job market, coupled with its affordable housing options and high quality of life, continues to attract a young and educated workforce.

Nashville, Tennessee

Nashville, Tennessee, another 18-hour city, is known for its vibrant music scene and booming healthcare industry. The city offers a blend of urban amenities and southern charm, drawing a growing population.

For real estate investors, Nashville presents opportunities for both residential and commercial investment, thanks to its diverse economy and growing housing demand.

Charlotte, North Carolina

Charlotte, North Carolina, offers a dynamic mix of business growth, cultural amenities, and a high quality of life.

Home to several Fortune 500 companies and a growing tech sector, the city attracts a skilled workforce and boasts a robust economy.

With its affordable housing market and strong rental demand, Charlotte is a promising market for real estate investment.

Denver, Colorado

Denver, Colorado, is another successful 18-hour city, attracting residents and investors alike with its booming economy, stunning natural surroundings, and robust job market.

Denver's diverse economy and lifestyle amenities, combined with its growing population, create a favorable environment for real estate investment.

Portland, Oregon

Portland, Oregon, is a vibrant 18-hour city known for its strong job market, progressive culture, and abundance of outdoor activities.

Its booming tech industry and green initiatives attract a diverse mix of residents. For investors, Portland's dynamic economy and steady housing demand make it an attractive real estate market.

Bottom Line

The term "18-hour city" represents a category of cities that operate with a vibrant economic and lifestyle pulse from dawn to midnight.

They offer a unique blend of urban amenities, economic growth, and affordability, making them appealing to a wide range of residents and investors.

18-hour cities are characterized by their growing populations, strong job markets, diverse lifestyle amenities, efficient transportation infrastructure, and availability of affordable housing options.

These factors contribute to a dynamic and resilient real estate market, offering promising opportunities for investment.

Investing in 18-hour cities can offer potential for high rental yields, lower investment costs, reduced competition, and favorable economic conditions.

However, investors should also be aware of potential challenges, such as oversupply of housing, economic volatility, infrastructure strain, and limited availability of investment-grade properties.

As these cities continue to grow and thrive, they present promising opportunities for real estate investment and contribute significantly to the nation's economic growth.

18-Hour City FAQs

About the Author

True Tamplin, BSc, CEPF®

True Tamplin is a published author, public speaker, CEO of UpDigital, and founder of Finance Strategists.

True is a Certified Educator in Personal Finance (CEPF®), author of The Handy Financial Ratios Guide, a member of the Society for Advancing Business Editing and Writing, contributes to his financial education site, Finance Strategists, and has spoken to various financial communities such as the CFA Institute, as well as university students like his Alma mater, Biola University, where he received a bachelor of science in business and data analytics.

To learn more about True, visit his personal website or view his author profiles on Amazon, Nasdaq and Forbes.

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